Trucking sounds off on DOL nominee over AB 5 role

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Updated Mar 16, 2023

The American Trucking Association's on Wednesday officially voiced its concern over Julie Su’s nomination as U.S. Secretary of Labor, citing her role in helping pass and implement California's AB5 law as Secretary of the California Labor and Workforce Development Agency.

Although it's been legally entangled on-again and off-again since it passed in 2019, AB 5 generally calls into question trucking's legal use of contracted/non-employee carriers, and seeks to determine if independent contractors in California are employees or indeed independent for purposes of its labor code. 

In a letter written and sent Wednesday to Bernie Sanders, chair of the Senate Committee on Health, Education, Labor & Pensions, and Ranking Member Bill Cassidy, American Trucking Associations President & CEO Chris Spear noted his agency was "concerned by Ms. Su’s public position on key issues, most notably her leading opposition to the right of drivers to operate as independent contractors — a cornerstone of trucking."

Owner-Operator Independent Drivers Association (OOIDA) President & CEO Todd Spencer earlier this month expressed similar concern, yet more straightforwardly opposed Su's nomination, calling on Sanders and Cassidy to "reject her nomination in order to protect the livelihoods and careers of the hard-working truckers we represent."

Su has served as Deputy Secretary of Labor since 2021, and while Spear didn't formally oppose her consideration to the Department of Labor's top job in his letter, his tone was clear: Su's documented ideologies on labor pose a threat to the trucking business model and the livelihood of countless truck drivers.

"AB 5 is designed to strip independent drivers of their choice and right to operate as contractors for motor carriers, in essence forcing them to become company employee drivers. It is wreaking havoc on thousands of self-employed, small-business owners by forcing them into legal limbo and placing administrative, compliance, legal and other unsustainable costs on the industry," he wrote. "Ms. Su has significant authority over the rulemaking process as Deputy Secretary of Labor and will have almost complete authority to write the final rule should she be confirmed as Labor Secretary."

In a statement issued to CCJ Thursday morning, the Truckload Carriers Association too voiced its concern over Su's public opposition to the independent contractor business model, "which is fundamental to the entrepreneurial DNA of the truckload industry," TCA wrote. "Having served as the former Secretary of the California Labor and Workforce Development Agency, she helped pass AB5, forcing thousands of self-employed, owner-operators to weigh leaving the state or industry all-together, or giving up their hard-earned small businesses to become employee drivers. If Ms. Su is confirmed as Labor Secretary, she will have considerable control over the agency’s enactment of a similar policy at the federal level. TCA asks that Ms. Su provide complete clarity over her intentions as the prospective agency chief regarding classification during the forthcoming nomination process.”

In further considering her nomination, Spear beseeched both Sanders and Cassidy to seek that clarity by asking Su a series of questions: if she considers AB 5 a policy success generally, and specifically as it relates to trucking?; What is her message to self-employed truckers who were forced by AB 5 to leave California to save their business, income, lifestyle, and freedom to earn a living on their own terms?; That many ICs choose to operate independently so they can determine their own schedules, grow their earning potential, and achieve their desired level of work/life balance, why should they be denied that right to choose their own career path?; and if she believes that the USDOL should consider contractual safety requirements between a motor carrier and an IC as evidence of misclassification and a violation of the Fair Labor Standards Act? 

"This destructive policy failure (AB 5) is weakening the supply chain and threatens systemic disruptions nationwide if the federal government chooses a similar policy. We are thus gravely concerned by the notice of proposed rulemaking published by USDOL’s Wage and Hour Division in October because it is very likely to have a similar effect to California’s AB 5 if the proposal stands," Spear penned. "Without the hundreds of thousands of independent owner-operators in our industry today, the supply chain would grind to an immediate halt, and a way of life of hundreds of thousands of small business men and women could be eradicated."

Jason Cannon has written about trucking and transportation for more than a decade and serves as Chief Editor of Commercial Carrier Journal. A Class A CDL holder, Jason is a graduate of the Porsche Sport Driving School, an honorary Duckmaster at The Peabody in Memphis, Tennessee, and a purple belt in Brazilian jiu jitsu. Reach him at [email protected].